PA Court Upholds Denial of Permits for LED Billboard Where ZBA Decision Was Evenly Split Leading to a Negative Decision and Doctrine of Natural Expansion for Non-Conforming Uses was Inapplicable

In 2003, the Pittsburgh Parking Authority issued an RFP for architectural services for a new parking garage. The design for the parking garage ultimately chosen by the Authority included video signs. The signs were later eliminated from the plan because the Authority could not justify the cost of their inclusion. The Pittsburgh Planning Commission approved the plan for the parking garage, but did not include the signs in that approval. The architect for the project still wanted to include the signs, seeking an outside company to partner with the Authority. Lamar subsequently entered into an agreement under which it would install the signs. One sign was to be an LED billboard; the other was to be a ticker sign. The LED sign was given approval as a minor amendment to the plan for the parking garage that had already received approval. The ticker sign required a separate set of variances and use approvals.

Once the permit for the LED sign was issued, Lamar put up a temporary vinyl sign and shortly thereafter began to construct the permanent LED sign. A number of City Council members filed a protest appeal contesting issuance of the sign permit. Lamar responded by filing suit against these council members. To put the conflict to rest, the City, a Council Member and Lamar entered into a Memorandum of Understanding. Its terms provided for a revocation of the sign permit issued by amendment to the approval of the parking garage, giving Lamar leave to appeal to the ZBA for the permit to be reinstated. Lamar withdrew its lawsuit and a stop-work order was issued for the partially constructed sign.

During proceedings for the reinstatement of the sign permit and other required variances and approvals, the ZBA heard testimony from the architect responsible for the design of the building. The architect urged that there were no negative impacts associated with the signs and that the design and dimensions of the signs were specific to the building. Testimony was presented on behalf of Lamar by the Parking Authority’s Executive Director, to the effect that the sign financed and installed by Lamar would provide additional revenue for the Authority. The Zoning Administrator testified to approving the sign as a minor amendment, believing that it complied with City regulations. The Vice President and General Manager confirmed this testimony, adding that Lamar had agreed to eliminate six non-conforming signs in exchange for approval of the LED sign. The leader of a nearby neighborhood association spoke in support of Lamar’s project based on the belief that the elimination of the six nonconforming signs and the installation of the LED sign would function to eliminate blight. The addition of the signs to the Authority’s parking garage also faced substantial opposition from City residents, in addition to the opposition by city officials. In particular, inhabitants of an historic building did not want to see the signs constructed because they believed that the signs would be visible from their building. They also claimed inadequate notice of the installation.

In making its decision, the ZBA consisted of only two members, since one member was recused due to a conflict of interest. The two remaining members rendered a split decion, which, as per applicable case law, was determined to be a legal denial of the applications. The trial court affirmed the ZBA’s determination. On appeal Lamar claimed that the adoption of the negative ZBA decision altered the status quo by revoking the permit for the LED sign was inaccurate because, at the time the negative decision had been adopted, the permit had already been revoked as per the previously executed MOU.

The Court outlined the decision making abilities of municipal boards noting that a split decision of the body when the ZBA is acting in an appellate capacity will constitute an affirmation of the previous decision. Therefore, in this case the split decision acted as affirmation of the denial of Lamar’s appeal of the revocation. The Court further explained that when a decision rests in the hands of two people, a majority (both people voting the same way) is required to effectuate a decision that will change the status quo and that a statutory zoning appeal is the proper remedy for a decision which fails to bring the desired action or change. An even split in a municipal board with more than two members also must result in the maintenance of the status quo.

The status quo in this case was the situation of the required permit having been revoked. Lamar was appealing the status quo by requesting that the permit be reinstated or that new permits for the same purpose be put in place. A majority in Lamar’s favor was not reached, therefore the status quo remained unchanged.

Lamar claimed that its sign was permitted under the doctrine of natural expansion of a non-conforming use. This doctrine exempts uses that existed before a zoning ordinance went into effect or changed, and allows the exempted use to “expand” as required to maintain economic viability or to take advantage of increases in trade” subject to certain limitations. While converting a conventional sign to a LED sign would increase economic viability, the original sign was not determined to be a non-conforming use. Even if Lamar could establish the applicability of the doctrine of natural expansion of a non-conforming use, the doctrine is limited by City code, specifically by a provision which disallows intensification or enlargement of the nonconformity.

Lamar also argued that the City was estopped from denying the requested relief because the company had spent large sums of money, most of which was unrecoverable, in expectation that the project would be brought to completion and that denial of permits at this late stage constituted an undue hardship. Lamar also disagreed that the sign would have adverse impacts on surrounding areas. However, the previous determination of a lack of good faith on the part of Lamar barred its claim of estoppel. While the court did find that the Zoning Administrator was mistaken in labeling the LED sign a minor amendment to the overall building plan, the high degree of bad faith on the part of Lamar, including an initial representation that the subject sign would cost approximately $5000 when the actual cost was $3.5 million, also acted to bar Lamar’s estoppel claim.

The denial of variances was upheld by the court because Lamar failed to demonstrate an undue hardship in light of the property maintaining a profitable use without the installation of the signs. The court also noted that if the variances were granted, doing so would amount to preferential treatment of one property owner in a zoning district where the requested use was universally prohibited.

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